Pakistan has set up a dedicated cryptocurrency investigation unit as it draws a harder line between regulating digital assets and policing their abuse.
- New crypto crime unit: the FIA is targeting laundering, terror financing, and other suspected offenses
- Split of duties: PVARA handles regulation; law enforcement handles criminal probes
- Banking opens, but tightly: licensed firms can access bank accounts under strict AML/CTF controls
- Broader push: Pakistan is formalizing crypto while keeping a close eye on misuse
The Federal Investigation Agency’s new unit will operate within the National Command and Control Centre, or NC3, a coordination hub that brings together anti-money laundering work, border monitoring, intelligence coordination, cyber patrols, dark web investigations, and cooperation with Interpol. The move comes as Pakistan launches crypto crime unit to target money flows that are increasingly hard to track with old-school enforcement tools.
That setup matters because crypto crime is rarely neat. Illicit funds can move from wallet to wallet, jump through exchanges, cross chains, and disappear into services built to blur the trail. Public blockchains are traceable, but tracing is not the same as catching anyone. It takes trained investigators, decent tools, and enough patience to follow the money without getting dazzled by jargon or smoke. Even the Pakistan launches crypto investigation unit reporting framed this as a broader enforcement shift, not just a one-off bust.
Muhammad Athar Waheed, director of the FIA’s Counter-Terrorism Wing, said the Pakistan Virtual Assets Regulatory Authority, or PVARA, remains responsible for digital asset regulation, while the FIA will focus on possible criminal activity involving cryptocurrencies.
PVARA remains responsible for digital asset regulation, while the FIA will focus on possible criminal activity involving cryptocurrencies.
That division of labor is the core of Pakistan’s current approach. PVARA is the market regulator. The FIA is the cop. One sets the rules for licensed activity; the other looks for fraud, laundering, terror finance, and other criminal use. In other words: if you want to operate a crypto business, you may be getting a seat at the table. If you are washing dirty money through it, the chair can get very uncomfortable very fast. The whole setup is rooted in the Pakistan’s Virtual Assets Act is a step forward debate over whether formal rules can actually tame a fast-moving sector.
The legal framework behind that shift is the Virtual Assets Act 2026, which established PVARA as the federal authority supervising exchanges, custodians, brokers, and token issuers. For readers less steeped in crypto plumbing: custodians are firms that hold digital assets on behalf of customers, while token issuers are entities that create or distribute digital tokens. The official Pakistan Virtual Assets Regulatory Authority site lays out the agency’s mandate, while the broader background of the Pakistan Crypto Council helps explain how the country got here.
The move is significant because it signals formalization, not blanket prohibition. Pakistan is not pretending crypto does not exist. It is trying to bring it under a legal umbrella while keeping the hammer handy for abuse. For a deeper look at the policy and legal mess that has long surrounded the sector, the Virtual Assets and Cryptocurrencies in Pakistan: Legal framework and digital economy risks is worth reading.
That said, the umbrella is not exactly made of tissue paper. In April, the State Bank of Pakistan allowed regulated banks to provide accounts to PVARA-licensed digital asset companies, but under strict conditions. Banks must verify licences, monitor accounts, keep customer funds separate from company money, and continue following anti-money laundering and counterterrorism financing requirements.
So yes, banking access is opening up. No, it is not a crypto free-for-all. The system is allowing licensed firms into the banking network, but only with safeguards that keep the money visible and ring-fenced. That is a far cry from the old “let’s just hope nobody launders a cartel’s balance sheet through us” model. For anyone tracking the policy arc, Pakistan Lifts Crypto Banking Ban for Licensed Firms in shows just how fast the ground shifted.
PVARA has also invited global exchanges and other virtual asset service providers, or VASPs, to apply for approval to operate in Pakistan. VASPs are the companies that provide crypto services such as trading, custody, brokerage, or token issuance. Applicants are expected to submit information on compliance records, security systems, finances, and local business plans.
That is the sort of screening a serious market needs. It also tends to annoy the loudest crypto hucksters, which is usually a good sign. The people promising guaranteed gains and “community-led” miracle yields rarely enjoy actual scrutiny. Funny how that works. Pakistan has already shown it can move hard against outright fraud, as seen in Pakistan Busts $60M Crypto Scam, Aims for Blockchain leadership with bold plans.
Officials said the FIA’s new setup will allow coordination across offices and real-time monitoring of investigations, and new rules are being introduced to complete inquiries within set timeframes. Waheed also called on the National Cyber Crime Investigation Agency and the Anti-Narcotics Force to create similar specialist teams.
If that happens, Pakistan would be building a more specialized enforcement structure across cybercrime, financial crime, and drug-related cases involving digital assets. That would not solve everything, but it would at least stop crypto investigations from being treated like an awkward side quest by officers who have no time, no training, and no clue what a blockchain explorer is. The country’s messy but resilient market reality is also reflected in Pakistan’s Crypto Defiance: Top 5 Exchanges Thriving despite national ban.
There is also a wider policy story here. In January, Pakistan signed an agreement with SC Financial Technologies, an affiliate of World Liberty Financial, to study possible use of the USD1 stablecoin for cross-border payments. A stablecoin is a cryptocurrency designed to hold a steady value, usually by being pegged to a fiat currency such as the U.S. dollar. Reuters also reported on the Pakistan partner with World Liberty Financial dollar-linked stablecoin plan, which underlined how seriously officials were testing blockchain-based payments.
Used carefully, stablecoins can make payments faster and cheaper, especially across borders. Used badly, they can become another shiny wrapper for risk, speculation, or regulatory arbitrage. The technology does not remove human stupidity; it just makes it easier to move at network speed.
Pakistan has also discussed a state-held Bitcoin reserve, plus using surplus electricity for Bitcoin mining and for artificial intelligence data centres. Those ideas remain discussions rather than confirmed national programs, but they point in the same direction: the government appears to see digital assets and digital infrastructure as strategic, not trivial.
Still, there is a real cautionary side to this. A regime built too heavily around enforcement can end up choking the very market it wants to formalize. That concern was raised by Zainab Samantash in LSE Business Review, who argued that Pakistan’s Virtual Assets Act gives the sector parliamentary backing and more legitimacy than an ordinance would, but warned that a framework designed mainly around policing could constrain growth if licensing tiers, agency coordination, tax treatment, and governance are left unclear.
That criticism deserves airtime. A crypto regime that is all stick and no structure tends to push activity back into the shadows. Once that happens, legitimate firms get buried in paperwork, consumers get weaker protection, and the scammers keep doing what they do best: lying, laundering, and pretending a Telegram group is a business model.
The better version of this approach is simple enough. Give legitimate firms clear rules. Keep banks involved, but under strict controls. Let regulators supervise the market. Let investigators chase actual abuse. And avoid turning every wallet into a suspected crime scene just because the asset class makes some people nervous.
For Bitcoin and broader crypto adoption, Pakistan’s latest move is encouraging in one important way: it treats the sector as real. A state does not build specialist units, banking pathways, and licensing rules for an industry it thinks is a joke. But the other half of the equation matters just as much. If the framework becomes too muddled, too slow, or too heavy-handed, it will protect nobody except the middlemen and the fraudsters. The job is to separate legitimate operators from outright crooks without burying the whole sector under bureaucratic sludge.
Key questions and takeaways
-
What is Pakistan’s new crypto crime unit for?
It is meant to investigate suspected criminal use of cryptocurrencies, especially money laundering, terrorism financing, and related offenses. -
Who regulates crypto in Pakistan now?
PVARA, the Pakistan Virtual Assets Regulatory Authority, is responsible for licensing and supervising digital asset businesses. -
What does the FIA do?
The FIA handles criminal investigations. In this setup, it focuses on abuse of crypto rather than licensing or market supervision. -
Can crypto firms use banks in Pakistan?
Yes, but only if they are licensed by PVARA and comply with strict rules, including fund segregation and AML/CTF checks. -
Is Pakistan banning crypto?
No. The direction appears to be formalization and control, not outright prohibition. -
Is Pakistan launching a Bitcoin reserve?
Not as a confirmed policy. A state-held Bitcoin reserve has been discussed, but it remains a proposal. -
Why does this matter for Bitcoin and crypto adoption?
It shows a government trying to create legal rails for digital assets while building enforcement tools to stop abuse. That is a more mature approach than pretending the sector can be ignored.
